RE: NewsAllana Potash Corp. (TSX VENTURE:AAA) ("Allana" or"the Company"), is pleased to announce that it has entered into anagreement with a syndicate of agents led by Dundee Securities Ltd.,together with Wellington West Capital Markets Inc. as co-leadunderwriter and including Cormark Securities Inc. and Fraser MackenzieLimited (the "Underwriters"), to purchase 12,910,000 common shares ofthe Company (the "Common Shares") at a price of $1.55 per Common Sharefor gross proceeds of $20,010,500 on a bought deal private placementbasis (the "Offering"). The Company has also granted the Underwritersan over-allotment option to increase the size of the Offering by up toan additional 1,936,500 Common Shares, such option being exercisable atany time up to 48 hours prior to the closing of the Offering. If theover-allotment option is exercised in full, the aggregate grossproceeds raised will be $23,012,075.
The net proceedsfrom the Offering will be used to fund continued exploration anddevelopment work, including a definitive feasibility study, at theCompany's Ethiopian potash project as well as future potentialstrategic land acquisitions and general corporate purposes.
Closingof the offering is anticipated to occur on or about March 1, 2011 (the"Closing Date") and is subject to the receipt of applicable regulatoryapprovals including approval of the TSX Venture Exchange. The CommonShares will be subject to a statutory hold or restricted period of fourmonths and one day following the Closing Date.
Inconnection with the financing, the Company has agreed to pay to theUnderwriters a cash commission of 6.0% of the gross proceeds raised andissue to the Underwriters that number of compensation options equal to5.0% of the number of Common Shares sold. Each compensation optionshall entitle the holder to acquire one Common Share of the Company ata price of $1.55 for a period of 18 months from the date of closing ofthe Offering.